PDL Biopharmaceuticals' (NDAQ:PDLI) list of shareholders is quickly becoming a who's who of activist hedge funds as yet another one joins the fight to unlock value for shareholders. Many are hoping that this additional representation will help the finally put the company over the edge and force a sale.

Daniel Loeb's Third Point slashed its stake in PDLI, from 9.7 percent to 5.1 percent, after the company refused to grant the activist investor a board seat, according to a Schedule 13D/A filing with the SEC. The news sent shares plunging down four percent before leveling out as shareholders speculated that the activist no longer saw value in the investment.

"Despite these positive developments, we are disappointed that the sale process is still being led by a board that does not include a Third Point representative, and that Patrick Gage remains the company's CEO, despite having demonstrated his unsuitability," said Loeb in a letter to the board.

Amid this selling, however, a relatively new buyer has emerged. Highland Capital unveiled its own 5.2 percent stake in the company for the first time in a Schedule 13D filing on October 29th. The activist hedge fund has been buying up shares on the open market up until October 22nd. They also sent a letter to the company's board in September making several demands.

Highland suggested that the company (1) seek additional expertise in evaluating the complex range of alternatives available for its royalty stream, (2) proactively pursue selling the entire company, (3) communicate to the market that it is doing so, (4) encourage Gage to resign as chairman, (5) encourage McDade to resign as CEO, (5) appoint Laurence Korn as chairman, and (6) add a shareholder representative to the board.

In the end, this is all great news for shareholders. While it is unfortunate that Third Point sold a part of its stake, it is reassuring that Highland stepped up to make the purchase. Clearly, some of Highland's demands have already been met and it will be interesting to see if the company follows through on the others. Regardless, PDLI is definitely a stock to watch!

Related Companies
Genentech Inc. (DNA)
Medarex Inc. (MEDX)
Immunomedics Inc. (IMMU)